by LAITH ULABY, Shyp
Conducting research with small businesses can pose many challenges, but these same dynamics also make ethnography one of the most rewarding and potentially impactful ways to study them. I have worked with small businesses in academic contexts as well as with a UX research consultancy, a big tech company, and now a startup, and I hope these perspectives and tips will be useful if you find yourself conducting ethnography with small businesses.
Why Small Businesses?
By some estimates there are over 28 million small businesses in the USA today, which compose over half the nation’s economic output and are the leading creators of jobs. They are also an important vehicle for economic empowerment and mobility for women, immigrants, and communities of color.
The importance of small businesses is not unique to the USA: Facebook, Google, and other companies are working overtime to capture the small business market in so-called “emerging markets”. In India alone, small businesses employ close to 40% of the workforce. As the next billion people get online and millions enter the global middle class, there are tremendous opportunities for small businesses and the services that support them.
What Is a Small Business?
Terms like “small business”, “small and medium business” (SMB), “small and medium enterprises” (SME) are thrown around without consistent definitions. Definitions may focus on revenue, number of employees, or other factors. Make sure that you have stakeholder consensus on how you are defining a small business (eg, does it include a sole proprietorship?) before designing your project. Having a conversation around what your stakeholders mean when they say “small business” can actually be an important way to develop the right research questions and understand how to design and structure your site visits.
It is also useful to consider what a small business is on a more theoretical level. A business or enterprise is many things:
- It is a person or group of people.
- It is part of a larger community of business like suppliers, B2B services, other small businesses (eg, the competitor down the street, the coffee shop next door).
- It is part of a community, which can be digital, physical, or both.
- It is a location imbued with a sense of space and place (even if it is digital).
- It is a legal entity.
- It is an entity that has its own “being” (in the ontological sense).
All of these dimensions are ripe with opportunities for ethnographic inquiry and heighten the need to “be there” when conducting research, as the interplay between them is often where the biggest insights come from.
Small businesses tend to be very non-standardized and employees/owners wear several hats at once. A deep understanding of how people navigate between different areas (showroom floor, stockroom, counter, delivery area, production area) as they switch between different roles (marketing, customer service, fulfillment, sales, ordering from suppliers, customer support) can only be accomplished by experiencing their actual environment. Empathising with the improvisation, even chaos, of running a small business is integral to seeing what is going on beyond the surface level.
Conducting research with small businesses poses some unique challenges. To begin with, although recruiting can be tricky in any situation, but among small businesses it can be especially difficult. The lack of a clear definition of these organizations means it’s critical to make sure that you are in alignment with your stakeholders regarding what a small business is and what segment you are interested in (eg, sector, brick and mortar vs. digital, location, technical sophistication, retail vs. service). Finding a good recruiter is also extremely important—even some prominent, national agencies in the USA and other advanced industrialized countries do not have great existing databases to work from. You will have to collaborate closely with the recruiter to make sure you are finding and vetting the right kinds of businesses.
When working with the recruiter it is also important to make sure they are finding the right people, since job titles, roles, and duties are not standardized and may be informal and fluid. For instance, if you are trying to find the person responsible for marketing, that might be the owner, the manager, or even an intern or grandkid. It is vital that the recruiter knows what you are trying to learn about and that you are talking to the person with the right knowledge or authority.
Small business owners and employees are often extremely busy, so you will have to be prepared to work around their schedule and pause the session while they tend to other matters. I usually try to budget a little extra time in the scheduling so that if things come up I can still observe enough and have time for the interview portion of the research. Along the same lines, make sure any tech or recording setup you have is mobile and flexible. I do my best to not rely on electrical outlets and bring my own internet hotspot (if needed). A GoPro type camera can be both unobtrusive and easy to shift around and adapt to different kinds of spaces.
As with any ethnographic enterprise, delving into how people think about and value relationships, objects, space, and interactions is a powerful lense through which to help companies consider their needs and empathise with them in the design process. To this end, chatting with multiple employees (even at the same time) in an informal way can help you to understand the challenges that small businesses face from different perspectives.
In my current research role at Shyp, a shipping and logistics startup, I recently conducted an exploratory ethnographic project with small businesses. While our typical user has been the consumers and occasional shippers, we knew that small businesses had been using or wanting to use our service and we wanted to understand their current fulfillment process better. While preliminary phone interviews helped us to understand some of the barriers to adoption, it wasn’t until I was able to do on-site observations and informal contextual interviews that I could understand their struggles and what Shyp would need to do to serve them. Here are a few examples of the insights I took away from the research:
- The difference between having a full backroom or just a closet for storing shipping supplies has implications that reverberate all the way through a small business's fulfillment and ecommerce strategy.
- Many of the shipping and fulfillment costs are invisible or not obvious to small business owners, making it difficult for them to arrive at an accurate cost/benefit analysis of their options.
- While very price sensitive, money was not the only driver in decision making. Adopting a service that might potentially replace a current employee put the business owner/manager in an uncomfortable position. Managers and owners were much more excited about services that allowed their current staff to do more, not replace them. Similarly, even if the business could save money in some scenarios, relinquishing control to others was often difficult as the business was such a big part of their identity.
- The pain points faced by wrangling different systems and often being forced to jump between different tasks and spaces made owners wary of adding any additional services unless it eased their burden significantly elsewhere in their lives.
- My team went into the researcher thinking that we would be able to primarily define our target market by volume, but the research showed that the value of our service depended much more on the type of items that the business was shipping and their fulfillment space constraints.
- Give yourself a bit more recruiting lead time so that you can course correct if needed.
- Be flexible: rather than trying to find the perfect participants, try to get a broad set of perspective and challenges. Along the same lines, consider recruiting a few more participants than you would for a typical ethnographic study. Not only are cancelation rates sometimes higher (and rescheduling harder), but it can be harder to predict whether you’ve identifies the right participants until you are in their own space.
- Define the objectives of the researcher in as much detail as possible with both your research stakeholders and the recruiter. Ethnography is most useful in the more exploratory and generative phases, but it is important to know where to follow up when participant behaviors or your observations potentially align with product roadmaps.
- Product teams can often get a bit blinkered thinking about how their service/product/etc fits into the lives of people at small businesses. Journey maps can be particularly effective at showing how the one activity your team is focused on intersects with other activities, routines, and even other services/products.
- Most small businesses are going to be hesitant about the idea of a flood of folks showing up to study them, so try to limit the team going on site visits to only 2–3 people if possible.
Laith Ulaby is the head of user experience and design research at Shyp, a logistics startup based in San Francisco. He previously worked as a researcher at Google, AnswerLab, and Convergence: Center for Policy Resolution. Ulaby completed his PhD in ethnomusicology (ethnographic study of music and popular culture) at UCLA where his research focused on the role of music and technology in national identity in the Arab world. Ulaby is a recipient of both a Fulbright-Hays and Mellon Foundation Postdoctoral fellowships. He has delivered guest lectures at over fifteen universities and the US Department of State.
Enabling Ethnography in Small Budget Economies, Dani Cuaron et al (free article—sign in required)
Place and Small Businesses, Josh Kaplan (free article—sign in required)
Representing the Non-formal: The Business of Internet Cafés in India, Nimmi Rangaswamy (free article—sign in required)
Singapore Shop Houses VasenkaPhotography CC BY 2.0
Nice discussion of the kind of flexibility required to get the answers, even when we don’t necessarily start out knowing exactly what questions we are asking!
Great summary! Flexibility really is key. And I can’t agree more with not deciding in advance what the key segments are (e.g., employee size, industry, income, geography). The great diversity among small businesses means that segmentation needs to be done for every project. A couple other tips I have learned about doing research with small businesses:
– Time is money so not only do you need to be flexible about where & when you show up, you need to realize that even large financial incentives (thank you gifts) can’t make up for the potential lost time or hassle of participating in your study. You may need to get creative with your incentives. For example, having an expect attend the field visit that can offer process or other recommendations at the end of the session can be worth far more!
– You may end up with more participants in your study than you planned! In a family run business for example, the kids may be helping out after school and suddenly be part of your interview. Not only do you need to be flexible, you should be prepared with extra informed consent forms/NDAs, incentives, etc. And decide what you will do if a minor gets involved. Do you ask a parent if you can interview them or simply make sure not to include them in videos, etc.